Navigating the Shift to Digital Tipping: Opportunities and Challenges in Supporting Front-line Service Employees

Abstract

As cashless payments become more common, tipping has declined, impacting front-line service workers who rely on tips for income. To address this, businesses are adopting digital tipping solutions, such as QR codes and personalized tip codes, allowing guests to tip specific staff and ensuring fair distribution. Platforms like Grazzy enable workers to access tips instantly, boosting motivation and service quality. However, challenges remain: some employees have become overly aggressive in soliciting tips, making guests uncomfortable and raising concerns that hotels are shifting compensation responsibility onto customers. Balancing fair compensation, professionalism, and guest experience is crucial for successful digital tipping adoption.